One day their "Master Keeper of Building Projects" (MKBP) got a headache explaining the process of "Best Value" to his students while they feasted on bacon sandwiches and ice cream (as these, of course, were the best prevention for heart disease and diabetes)
.
The Master began…"Design-Bid-Build awards the contract to the lowest Price, why? Since the 'plans & specifications' (the solution) are exactly the same for every Priced Proposal submitted (bids), the lowest bid provides the best value. The end."
At which point the MKBP and a Student began an exchange....
STUDENT: Wait...is the lowest price always the best value?
MASTER: The designed solution (plans & specifications) defines the scope of the project for every bidder, and all bids are based on the exact same plans & specs, so yes, the lowest price is the best value. The end.
STUDENT: Wait...the plans & specs are completely detailed, so it's simply a matter of following the plans & specs?
MASTER: Since the contract obligates the bidder to follow the plans & specs, the lowest price bid will provide best value. The end.
STUDENT: Wait...what if the builder interprets the plans & specs differently than the designer?
MASTER: No, they are both professionals, they're in the same industry, so they speak the same language. Therefore the lowest price is the best value. The end.
STUDENT: Wait...what if the designer makes a mistake or leaves some little detail out? Can that happen?
MASTER: No way, architects have been doing this longer than anyone else, besides the builder is reputable. They won't just follow the plans & specs "blindly", they'll make it "right". So lowest price equals best value. The end.
STUDENT: Wait...the builder was awarded the project because he was the lowest price?
MASTER: Yes, and since his competitors were pricing the exact same set of plans & specs, the winning builder might have "taken a haircut" to win this project. But no matter, if he looses money its his own fault, what's he going to do?, not build it right? No, no...the lowest price is still the best value. The end.
STUDENT: Wait...what if he's pinched on dollars and doesn't say anything, and just slips in 'crap'?
MASTER: No way dude, my architect will surely catch it. Architects always catch that kind of stuff. Besides, they're responsible for catching that kind of stuff...Yea, so the lowest price is definitely the best value. The end.
STUDENT: Wait...I wonder why the other builders had bids so much higher than our guy?
MASTER: Obviously, they were trying to make a boat-load of money off the project. At prices like that, I bet they have no work at all. The end.
STUDENT: But if they had no work at all, wouldn't their bid price be lower...to get the job?
MASTER: The other guys should have bid prices much lower… Oh well, the lowest price is the best value. The end
(MASTER thinks to himself)...wait a minute
...my guy was the lowest price.
If the others guys were right…
No, no, the lowest price is best value...
...the lowest price is...good enough value. Besides, we can tell our King we contracted for the lowest price...who can disagree with that?...we saved money...the END.
2 years later...from the office of MKBP
The Master at work:
Hello...yea... I just got CO #12...wasn't that a part of the Punch-List work?...he said you should have done it the other way to begin with...he said that doesn't matter because of...he said to look at his stamp...no, the shop drawing stamp...well, call me back when you find it.
Hello...I know, I talked to him...he said there was no detail or note, and you approved the shop drawing...I know, I told him about the stamp and the meeting minutes...Okay, call me back.
Hello...yes sir...no, we're still waiting...they should have it next week...oh that?...well that was never in the plans...That's what I thought, but that would make it more than code...code?...well the project we looked at was designed that way, and in our design meetings you said we had to meet budget...so...has she checked the thermostat?...Okay, let me call you back.
Hello...have you checked out...what?...13...but...how much? Can't you find something cheaper? No, he said that it's standard...all builders should know that...that's what he said...Hang on, Hello...no, he's on the other line...hang on, I'll ask him...Can you guys install it like the first sketch shows...he can't until tomorrow, he has meetings the rest of the day...Okay, so what's that?...14...Okay...number 14 it is...sure, sure...later.
Hello...yes sir...because they had the best bid...the best bid...because they all had the same plans...it's all they do, that's what they told us...we were all looking at the same thing...yes sir...Okay, lowest price...well, we usually always take the lowest price because it's the best price...compared to the other guys' bids...of course they were qualified...95% of their business is repeat...I don't know...maybe we're their only new client in a while...I guess we're in the 5%...doesn't make me feel any better either...when?...tomorrow?...what time?...yes sir, I can clear my schedule...I'll be there...goodbye.
6 months after project's end...
MASTER TO THE KING: Well all the bids are over budget except these guys...they have the best price...let's get started...........anyone see any unicorns lately?
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